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Finextra
08-05-2025
- Business
- Finextra
Nordic countries develop offline payment backups amid geopolitical upheaval
Finland, Sweden, Norway, Denmark and Estonia are developing an offline card payment systems to avoid outages if online services are knocked out, according to Reuters. 0 The plans comes amidst Western intelligence claims that in recent years Russia has targeted undersea infrastructure in the Baltic Sea region. Bank of Finland board member Tuomas Valimaki tells Reuters that the chance of major disruptions has increased because of the "geopolitical situation". Norway and Denmark have already rollout out offline payments, with Sweden planning to join them by July 2026 and Finland and Estonia also working on systems, says Reuters. The Nordic countries are among the lowest users of cash in the world. According to central bank data, just 10% of Finns use notes and coins as the their primary payment method. The threat does not come only from Russia, says Valimaki, noting Europe's reliance on US giants Visa and Mastercard. "We cannot rule out that one night someone on Truth Social comes up with using payments as a pressure tactic," he tells Reuters, referring to Donald Trump's favourites social media platform.
CNA
07-05-2025
- Business
- CNA
Exclusive-Nordics and Estonia rolling out offline card payment back-up in case internet cut
HELSINKI : Finland, Sweden, Norway, Denmark and Estonia are rolling out offline card payment systems to provide a back-up if internet connections are lost, including due to sabotage, Bank of Finland board member Tuomas Valimaki said on Wednesday. The plans come after the Baltic Sea region has suffered several instances of unexplained damage to critical undersea infrastructure in recent years, and as Western intelligence services have accused Russia of committing various acts of sabotage - a charge the Kremlin rejects. "The likelihood of major disruptions has increased because the geopolitical situation has changed worldwide. There is a war in Europe, and around that war, there is all sorts of hybrid influence and harassment, which may involve disrupting or cutting connections," Valimaki told Reuters, referring to Russia's invasion of Ukraine. He said payments were a potential target because of their critical role in everyday life. Only 10 per cent of people use cash as their primary payment method in Finland, central bank data show, making the country highly dependent on card payments. "Since card payments require functioning international data links, Finland must be prepared for interruptions. Many other countries are of course in the same situation," Valimaki said, adding Norway, Sweden, Denmark and Estonia were also planning to introduce offline card payments, and possibly other nations too. Valimaki said the plans were still being developed, but offline payments can involve using terminals that encrypt and store transaction data until an internet connection can be restored. Sweden's central bank told Reuters that it hoped to establish a system by July 1, 2026, that would allow Swedes to make offline card payments to buy essential goods in the event of disruptions lasting up to seven days. Central banks in Norway and Denmark said they had already launched offline electronic payments that they continue to develop. Estonia's central bank did not immediately respond to requests for comment. Last year, the Nordic region's largest bank, Nordea, was hit by an unprecedented denial of service campaign that lasted for weeks and at times prevented customers from accessing their accounts online. All of Europe should reduce its dependence on card payments, which are currently heavily reliant on U.S. companies Visa and Mastercard, Valimaki said. "We cannot rule out that one night someone on Truth Social comes up with using payments as a pressure tactic," he said. Truth Social is the social network where U.S. President Donald Trump posts many of his ideas. To provide an alternative, Finland will introduce a national system for instant payments in a few years, while offline payments will become possible for consumers next year, Valimaki said. "We may feel like we have options, to pay with debit or credit or with Apple Pay for example, but all of those function via the Visa and Mastercard infrastructure," he said, calling for diversification. Speaking separately in Helsinki, NATO's Head of Defence Planning Section, Christian-Marc Lilflander, said finance ministers should be more involved in discussions on security to better prepare for threats in financial services. The European Central Bank is planning to introduce a digital euro, which would enable instant payments, but Valimaki said it would take years to establish the system even if it secured the political backing it needs from all euro zone countries. In another push to protect financial security, Finland is also introducing a national system of reserve bank accounts. Under the system, the National Financial Stability Authority would be able to give Finns access to their savings even if their bank was unable to operate, Valimaki said.
Free Malaysia Today
27-04-2025
- Business
- Free Malaysia Today
ECB launches new task force to simplify banking regulation
The ECB's task force included central bank governors from Germany, France, and Italy, as concerns mounted over the region's decline. (Reuters pic) BRUSSELS : The European Central Bank has convened a task force led by some of its most powerful governors aimed at simplifying banking regulation, amid growing fears the region is falling behind. The central bank governors of Germany, France and Italy are among the key figures in the newly-convened group, as is the governor of the Bank of Finland, who's also the first vice chair of Europe's Systemic Risk Board, according to people familiar with the matter asking not to be identified as the information is private. The issue is likely to stoke internal tensions with the ECB's supervisory arm, which is helmed by a separate set of officials who regard banking regulation as their territory and are staunch defenders of Europe's high regulatory standards against the wave of global rollback sparked by the Trump administration, two of the people said. The ECB declined to comment, as did representatives for Germany's Bundesbank, the Bank of France, the Bank of Italy and the Bank of Finland. The task force's creation follows a controversial letter from the central bank governors of Germany, France, Italy and Spain to the European Commission earlier this year, directly arguing for a 'comprehensive assessment' of Europe's banking rules to ensure a 'level playing field' with other major jurisdictions. The lobby for Europe's banking sector, whose profitability and valuation has long lagged US rivals, had been advancing similar calls. The quartet's appeal had unsettled some governing council peers who balked at the precedent of a subset of governors asking the commission to intervene in something that was a core competence of the ECB, other people familiar with the situation said. One official told Bloomberg he was concerned the simplification pursued by governors could be hijacked by politicians who want to deregulate banks in order to boost Europe's growth. The task force's remit and time line are unclear. The work could focus on the reporting banks need to do on their business or the governors could take a broader view than just the ECB's supervisory remit, by focusing on how European banking rules are transposed into the mass of rules that lenders have to comply with, and the broader regulatory framework, according to some of the people. The ECB has already begun simplifying some of its processes, including bank capital model approvals, while the European Banking Authority, which transposes regulations to day-to-day standards, has also claimed 'significant progress' in simplifying standards. The EU has also accelerated a planned review of its banking framework from 2028 to 2026. Still, other jurisdictions have moved much faster. The US Consumer Financial Protection Bureau has committed to halving its supervisory interventions, while other agencies have already pared back some rules and promised to go further. In the UK, regulators have announced more than a dozen industry-friendly rule changes this year, including a 70% cut in the red tape associated with capital requirements and less frequent stress tests.
Reuters
24-04-2025
- Business
- Reuters
Finland plans tax cuts to boost economy; to cut corporate tax to 18% from 20%
HELSINKI, April 24 (Reuters) - Finland's government announced tax breaks for companies and employees in an attempt to boost the country's ailing economy in a mid-term budget review it completed late on Wednesday. In office since June 2023, the government had promised to stop public debt from growing despite the economy's slow recovery from a recession. But at the mid-term budget talks, it chose to loosen its budget discipline and opt for tax breaks in the hope of boosting growth. Corporate tax will be cut to 18% from 20%, the government said, while employee income taxation will be reduced by a total of 1.1 billion euros ($1.25 billion). "We will make Finland one of Europe's most attractive countries for investments," Prime Minister Petteri Orpo told reporters after two days of budget talks. Boosting growth is essential to fund increased spending on defence and other government expenses, Orpo said. The Finnish economy shrank by 0.1% last year, according to preliminary data, while the Bank of Finland has warned 0.8% growth forecast for this year was under threat from tariffs and the global trade war. The tax breaks will be partially funded with a one-time withdrawal from the state pension fund, the government said. Finance minister Riikka Purra said the government remained committed to stabilising public debt by the end of 2027 but acknowledged it would miss its initial target of reducing the fiscal deficit to 1% of gross domestic product by then. According to finance ministry calculations, the deficit would shrink in 2026 and 2027 thanks to the pension fund withdrawal but then resume growth in 2028 and 2029 after the government's planned term. While the right-wing government had estimated the 2024 deficit to be 3.7% of GDP, statistics office data on Tuesday showed it had reached 12.2 billion euros, or 4.4%, well above the European Union 3% limit. The government now expects a 12.3 billion euro deficit in 2025. The government earlier this month announced plans to raise defence spending to 3% of GDP by 2029, from 2.4%, to meet growing NATO demands.
New Straits Times
24-04-2025
- Business
- New Straits Times
Finland plans tax cuts to boost economy; to cut corporate tax to 18pct from 20pct
HELSINKI: Finland's government announced tax breaks for companies and employees in an attempt to boost the country's ailing economy in a mid-term budget review it completed late on Wednesday. In office since June 2023, the government had promised to stop public debt from growing despite the economy's slow recovery from a recession. But at the mid-term budget talks, it chose to loosen its budget discipline and opt for tax breaks in the hope of boosting growth. Corporate tax will be cut to 18 per cent from 20 per cent, the government said, while employee income taxation will be reduced by a total of €1.1 billion (US$1.25 billion). "We will make Finland one of Europe's most attractive countries for investments," Prime Minister Petteri Orpo told reporters after two days of budget talks. Boosting growth is essential to fund increased spending on defence and other government expenses, Orpo said. The Finnish economy shrank by 0.10 per cent last year, according to preliminary data, while the Bank of Finland has warned 0.80 per cent growth forecast for this year was under threat from tariffs and the global trade war. The tax breaks will be partially funded with a one-time withdrawal from the state pension fund, the government said. Finance Minister Riikka Purra said the government remained committed to stabilising public debt by the end of 2027 but acknowledged it would miss its initial target of reducing the fiscal deficit to one per cent of gross domestic product by then. According to finance ministry calculations, the deficit would shrink in 2026 and 2027 thanks to the pension fund withdrawal but then resume growth in 2028 and 2029 after the government's planned term. While the right-wing government had estimated the 2024 deficit to be 3.70 per cent of GDP, statistics office data on Tuesday showed it had reached €12.2 billion, or 4.40 per cent, well above the European Union three per cent limit. The government now expects a €12.3 billion deficit in 2025. The government earlier this month announced plans to raise defence spending to three per cent of GDP by 2029, from 2.40 per cent, to meet growing NATO demands.
